AMP Capital pushes for tax reform

Tax reform, including an increase in the GST, would boost investment markets and the Australian economy, argues AMP Capital chief economist Shane Oliver.

Mr Oliver said an increase in the GST to 15 per cent would likely mirror the experience when the tax was introduced in 2000: spending would be brought forward, and the economy would receive a boost.

He said markets would react positively to a full reform package including a hike in the GST, reduction in income tax and other reforms around capital gains tax.

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“If Malcolm Turnbull can continue to do a reasonable job in terms of selling the case for reform, then it could have a positive impact on the Australian economy because we really need to reinvigorate the economic reform process if we’re going to get real incomes rising,” Mr Oliver said.

Mr Oliver argued that the debate around reform has also turned positive, indicating that things aren’t being ruled out before the conversation has begun.